Thursday, November 19, 2015

Let's Take Off With The Airline Industry For A Potential 800% Upside

The sector has famously destroyed shareholder value, as ROIC < WACC since 1993.
43 operators have gone bankrupt since 2001.
More consolidation leads to more rational players.
Operators are not re-engaging in price wars; the best indicator is that, while oil prices plummeted 50%, prices have increased 10-30% in the last two years.
I estimate ROIC to improve up to 4.4%, leading EV to appreciate up to 165% and equity up to 800%.

Is Daqo A Two Trick Pony?

Summary After reaching our target price in less than four months, Daqo Energy stock dropped to our initial entry point during the las...